[IP] Fwd: [Dewayne-Net] TAXING HIGH SPEED SERVICES: A QUANTIFICATION OF THE EFFECTS ON THE DSL INDUSTRY AND UNIVERSAL SERVICE
Delivered-To: dfarber+@xxxxxxxxxxxxxxxxxx
Date: Tue, 27 Apr 2004 21:17:21 -0700
From: Dewayne Hendricks <dewayne@xxxxxxxxxxxxx>
TAXING HIGH SPEED SERVICES: A QUANTIFICATION OF THE EFFECTS ON THE DSL
INDUSTRY AND UNIVERSAL SERVICE
Curiously, on the day the Senate began deliberation on Internet taxation, a
new research report on the issue was released. The imposition of state and
local telecommunications taxes on digital subscriber line (DSL) services
would slash federal Universal Service Fund (USF) contributions by $280
million and lead to $4.3 billion in reduced industry revenues available for
investment in new union jobs and expanded availability of broadband
technologies, according to a new study released today by the New Millennium
Research Council (NMRC). The NMRC study, "Taxing High-Speed Services: A
Quantification of the Effects on the DSL Industry and Universal Service,"
was written by economist Stephen Pociask. Mr. Pociask is president of
TeleNomic Research, a consulting firm specializing in public policy
analysis for information technology industries. Pociask said: "DSL service
is price-sensitive and an increase in taxes would produce an increase in
price, leading to a significant reduction in demand and a decrease in total
industry revenues." He explained that consumers would migrate to tax-exempt
cable-modem service, or abandon high-speed access altogether. "Since cable
operators do not pay into the Universal Service Fund, an increase in
cable-modem demand would not help state and local governments raise taxes
nor would it help fund universal service programs." USF contributions are
paid on all interstate telecommunications services and are used to support
telecom service for low income customers, underwrite network development in
high-cost areas, and fund Internet services for schools, libraries, and
rural healthcare providers. Pociask warned: "Because universal service
programs are already under financial strain, this substantial contribution
loss would put these social programs in serious jeopardy."
[SOURCE: New Millennium Research Council Press Release]
<http://www.newmillenniumresearch.org/news/042604release.pdf>
See full report at:
<http://www.newmillenniumresearch.org/archive/042604report.pdf>
Archives at: <http://Wireless.Com/Dewayne-Net>
Weblog at: <http://weblog.warpspeed.com>
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